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Pollution Haven Hypothesis: A Dynamic Panel Data Analysis for BRIC and MIST Countries

Year 2021, Volume: 5 Issue: 2, 471 - 493, 20.12.2021
https://doi.org/10.33399/biibfad.918535

Abstract

Developing countries are trying to create attractive opportunities for new investments with the aim of faster economic growth. In such countries where the primary goal is economic growth, environmental factors may remain in the background compared to developed countries. Some of developing countries become pollution haven for pollution intense industries due to relatively flexible environmental policies compared to developed countries. In this study, the validity of the pollution haven hypothesis was investigated for Brazil, Russia, India, China (BRIC) and Mexico, Indonesia, South Korea, Turkey (MIST). The relationship between per capita carbon dioxide emissions, exports, foreign direct investment inflows, per capita GDP and Environmental Policy Stringency Index for the period 1990-2015 was investigated using generalized methods of moments. This paper includes two models for investigating the pollution effect of variables; According to the findings of the first model, foreign direct investments and GDP per capita increase carbon dioxide emission in BRIC and MIST countries and there is an inverse relationship between the square of GDP per capita and carbon dioxide emission. According to the findings of the second model, the tightening of the environmental policy reduces the foreign direct investment inflows.

References

  • Ahmad, M., Jabeen, G., & Wu, Y. (2021). Heterogeneity of pollution haven/halo hypothesis and environmental kuznets curve hypothesis across development levels of chinese provinces. Journal of Cleaner Production, 285, 124898.
  • Akbostancı, E.,G. Tunç, İ. ve Türüt-Aşık, S. (2007). Pollution haven hypothesis and the role of dirty İndustries in Turkey’s exports. Environment and Development Economics, 12(2), 297-322.
  • Aliyu, M.A., (2005). Foreign direct investment and the environment: Pollution haven hypothesis revisited. Eight Annual Conference on Global Economic Analysis.
  • Al-Mulali, U. & Tang, C.F. (2013). Investigating the validity of pollution haven hypothesis in the Gulf Cooperation Council (GCC) countries. Energy Policy, 60, 813-819.
  • Arellano, M. & O. Bover (1995). Another look at the instrumental variable estimation of error-components models. Journal of Econometrics, 68, 29–51.
  • Arellano, M. & S. Bond (1991). Some tests of specification for panel data: Monte Carlo evidence and an application to employment equations. Review of Economic Studies, 58, 277–298.
  • Atıcı, C., (2012). Carbon emissions, trade liberalization and the Japan ASEAN ınteraction: A group-wise examination. Journal of the Japanese and International Economies, 26(1), 167-178.
  • Baek, J. (2016). A new look at the FDI-income-energy-environment nexus: Dynamic panel data analysis of ASEAN. Energy Policy, 91, 22-27.
  • Balsalobre-Lorente, D., Gökmenoğlu, K.K., Taşpınar, N. & Cantos-Cantos, J.M. (2019). An approach to the pollution haven and pollution halo hypothesis in MINT countries. Environmental Science and Pollution Research, 26, 23010-23026.
  • Baltagi, B. (2005). Econometric Analysis of Panel Data. Chichester: John Wiley & Sons.
  • Bao, Q., Chen, Y., & Song, L. (2011). Foreign direct investment and environmental pollution in China: A simultaneous equations estimation. Environment and Development Economics, Cambridge University Press, 16(1), 71-92.
  • Birdsall, N. & Wheeler, D. (1993). Trade policy and industrial pollution in Latin America: Where are the pollution havens? The Journal of Environment and Development, 2(1), 137–149.
  • BM (1992). United Nations Framework Convention on Climate Change. United Nations, Fccc/Informal/84, Ge. 05-62220.
  • Bun, M.J.G, & Sarafidis, V. (2015). Dynamic Panel Data Models. Badi H. Baltagi (Ed.). The Oxford Handbook of Panel Data Models. New York: Oxford Universirt Press, 76-110.
  • Cole, M.A. & Elliott, R.Jr. (2005). FDI and the capital intensity of “dirty” sectors: A missing piece of the pollution haven puzzle. Review of Development Economics, 9, 530-548.
  • Cole, M.A., Elliott, R.Jr. & Fredrikson P.G. (2006). Endogenous pollution havens: Does FDI influence environmental regulations? Scandinavian Journal of Economics, 108 (1), 157-178.
  • Destek, M.A. & Okumuş, İ. (2019). Does pollution haven hypothesis hold in newly industrialized countries? Evidence from ecological footprint. Environmental Science and Pollution Resarch, 26, 23689–23695.
  • Dietzenbacher, E. & Mukhopadhyay, K. (2007). An empirical examination of the pollution haven hypothesis for India: Towards a green leontief paradox? Environmental and Resource Economics, 36, 427-449.
  • Dünya Bankası (2020). World Development Indicators. https://databank.worldbank.org/source/world-development-indicators#
  • Ederington, J., Arik Levinson & Jenny Minier, (2004). Trade liberalization and pollution havens. NBER Working Papers 10585, National Bureau of Economic Research, Inc.
  • Grossman, G.M. & Kruger, A., (1995). Economic growth and environment. The Quarterly Journal of Economics, 110(2), 353-377.
  • Halıcıoğlu, F. & Ketenci, N. (2016). The impact of international trade on environmental quality: The case of transition countries. Energy, 109, 1130-1138.
  • Hao, Y. & Liu, Y-M. (2015). Has the development of FDI and foreign trade contributed to China’s CO2 emissions? An empirical study with provincial panel data. Natural Hazards, 76, 1079-1091.
  • Karluk, R. (2009). Uluslararası Ekonomi. Ankara: Beta Yayınevi.
  • Kearsley, A. & Riddel, M. (2010). A further inquiry into the pollution haven hypothesis and the environmental kuznets curve. Ecological Economics, 69, 905–919.
  • Kızılkaya, O. (2017). The impact of economic growth and foreign direct investment on CO2 emissions: The case of Turkey. Turkish Economic Review, 4 (1), 1006-118.
  • Lee, C.G. (2009). Foreign direct ınvestment, pollution and economic growth: Evidence from Malaysia. Applied Economics, 41, 1709-1716.
  • Merican, Y., Yusop, Z., Mohd, Z. & Hook, L.W. (2007). Foreign direct investment and the pollution in five ASEAN nations. International Journal of Economics and Management 1(2), 245-261.
  • Omri, A., Nguyen, D.K., & Rault, C. (2014). Causal interactions between CO2 emissions, FDı, and economic growth: Evidence from dynamic simultaneous-equation models. Economic Modelling, 42, 382-389.
  • Pao, H-T. & Tsai, C-M. (2011). Multivariate granger causality between CO2 emissions, energy consumption, FDI and GDP: Evidence from a panel of BRIC countries. Energy, 36(1), 685-693.
  • Poelhekke, S. & Ploeg, F. (2015). Green havens and pollution havens. The World Economy, 38(7), 1159-1178.
  • Rahman, Z.U., Chongbo, W. & Ahmad, M. (2019). An (a)symmetric analysis of the pollution haven hypothesis in the context of Pakistan: A non-linear approach. Carbon Management, 10(3), 227-239.
  • Rahul, R. & Viswanathan, P. K. (2018). Impact of environmental policy stringency on FDI: A global perspective. International Journal of Pure and Applied Mathematics, 118(5), 623-629.
  • Ritchie, H. & Roser, M., (2018). CO₂ and greenhouse gas emissions. Published online at OurWorldInData.org. Retrieved from: 'https://ourworldindata.org/co2-and-other-greenhouse-gas-emissions'.
  • Sadik-Zada, E.R. & Ferrari, M. (2020). Environmental policy stringency, technical progress and pollution haven hypothesis. Sustainability, 12 (9), 3880.
  • Shao, Q., Wang, X., Zhou, Q. & Balogh, L. (2019). Pollution haven hypothesis revisited: A comparison of BRICS and MINT countries based on VECM approach. Journal of Cleaner Production, 227, 724-738.
  • Singhania, M. & Saini, N. (2021). Demystifying pollution haven hypothesis: Role of FDI. Journal of Business Research, 123, 516-528.
  • Solarin, S.A., Al-Mulali, U., Musah, I. & Öztürk, İ. (2017). Investigating the pollution haven hypothesis in Ghana: An Empirical Investigation. Energy, 124, 706-719.
  • Tang, J. (2015). Testing the pollution haven effect: Does th type of FDI matter? Environmental Resource Economics, 60, 549-578.
  • Ullah, A., Zhao, X., Kamal, M.A. & Zheng, J. (2020). Environmental regulations and inward FDI in China: Fresh evidence from the asymmetric autoregressive distributed lag approach. International Journal of Finance & Economics, 1-17.
  • Wagner, U., & Timmins, C. D. (2009). Agglomeration effects in foreign direct investment and the pollution haven hypothesis. Environmental Resource Economics, 43, 231-256.
  • Yıldırım, M., Destek, M.A. & Özsoy, F.N. (2017). Doğrudan yabancı yatırımlar ve kirlilik sığınağı hipotezi. C.Ü. İktisadi ve İdari Bilimler Dergisi, 18 (2), 99-111.
  • Yılmazer, M. & Açıkgöz-Ersoy, B. (2009). Kirlilik sığınağı hipotezi doğrudan yabancı yatırımlar ve kamu politikaları. Ege Akademik Bakış, 9 (4), 1441-1462.
  • Yoon, H. & Heshmati, A. (2017). Do environmental regulations effect FDI decisions? The pollution haven hypothesis revisited. IZA Discussion Papers No. 10897.
  • Zhang, J. & Fu, X. (2008). FDI and environmental regulations in China. Journal of the Asia Pacific Economy, 13(3), 332-353.

Kirlilik Sığınağı Hipotezi: BRIC ve MIST Ülkeleri için Dinamik Panel Veri Analizi

Year 2021, Volume: 5 Issue: 2, 471 - 493, 20.12.2021
https://doi.org/10.33399/biibfad.918535

Abstract

Gelişmekte olan ülkeler daha hızlı ekonomik büyüme amacıyla yeni yatırımlara yönelik cazip imkânlar oluşturmaya çalışmaktadır. Birincil amacın ekonomik büyüme olduğu bu gibi ülkelerde çevresel faktörler gelişmiş ülkelere göre arka planda kalabilmektedir. Gelişmekte olan bazı ülkeler, gelişmiş ülkelere kıyasla nispeten esnek çevre politikaları nedeniyle kirlilik yoğun endüstriler için kirlilik sığınağı haline gelmektedir. Bu çalışmada Brezilya, Rusya, Hindistan, Çin (BRIC) ve Meksika, Endonezya, Güney Kore, Türkiye (MIST) ülkeleri için kirlilik sığınağı hipotezinin geçerliliği araştırılmıştır. 1990-2015 dönemine ait kişi başı karbondioksit emisyonu, ihracat, doğrudan yabancı yatırım girişi, kişi başına gayri safi yurtiçi hasıla ve Çevre Politikası Sıkılığı Endeksi verileri arasındaki ilişki genelleştirilmiş momentler metodu kullanılarak araştırılmıştır. Çalışmada iki model kurulmuş; ilk modelin analizinde elde edilen bulgulara göre, doğrudan yabancı yatırımların ve GSYİH’nın BRIC ve MIST ülkelerinde karbondioksit emisyonunu arttırdığı ve kişi başına GSYİH’nın karesi ile karbondioksit emisyonu arasında ters yönlü bir ilişki olduğu tespit edilmiştir. İkinci modelin bulgularına göre ise çevre politikasının sıkılaşmasının doğrudan yabancı yatırım girişlerini azalttığı sonucuna ulaşılmıştır.

References

  • Ahmad, M., Jabeen, G., & Wu, Y. (2021). Heterogeneity of pollution haven/halo hypothesis and environmental kuznets curve hypothesis across development levels of chinese provinces. Journal of Cleaner Production, 285, 124898.
  • Akbostancı, E.,G. Tunç, İ. ve Türüt-Aşık, S. (2007). Pollution haven hypothesis and the role of dirty İndustries in Turkey’s exports. Environment and Development Economics, 12(2), 297-322.
  • Aliyu, M.A., (2005). Foreign direct investment and the environment: Pollution haven hypothesis revisited. Eight Annual Conference on Global Economic Analysis.
  • Al-Mulali, U. & Tang, C.F. (2013). Investigating the validity of pollution haven hypothesis in the Gulf Cooperation Council (GCC) countries. Energy Policy, 60, 813-819.
  • Arellano, M. & O. Bover (1995). Another look at the instrumental variable estimation of error-components models. Journal of Econometrics, 68, 29–51.
  • Arellano, M. & S. Bond (1991). Some tests of specification for panel data: Monte Carlo evidence and an application to employment equations. Review of Economic Studies, 58, 277–298.
  • Atıcı, C., (2012). Carbon emissions, trade liberalization and the Japan ASEAN ınteraction: A group-wise examination. Journal of the Japanese and International Economies, 26(1), 167-178.
  • Baek, J. (2016). A new look at the FDI-income-energy-environment nexus: Dynamic panel data analysis of ASEAN. Energy Policy, 91, 22-27.
  • Balsalobre-Lorente, D., Gökmenoğlu, K.K., Taşpınar, N. & Cantos-Cantos, J.M. (2019). An approach to the pollution haven and pollution halo hypothesis in MINT countries. Environmental Science and Pollution Research, 26, 23010-23026.
  • Baltagi, B. (2005). Econometric Analysis of Panel Data. Chichester: John Wiley & Sons.
  • Bao, Q., Chen, Y., & Song, L. (2011). Foreign direct investment and environmental pollution in China: A simultaneous equations estimation. Environment and Development Economics, Cambridge University Press, 16(1), 71-92.
  • Birdsall, N. & Wheeler, D. (1993). Trade policy and industrial pollution in Latin America: Where are the pollution havens? The Journal of Environment and Development, 2(1), 137–149.
  • BM (1992). United Nations Framework Convention on Climate Change. United Nations, Fccc/Informal/84, Ge. 05-62220.
  • Bun, M.J.G, & Sarafidis, V. (2015). Dynamic Panel Data Models. Badi H. Baltagi (Ed.). The Oxford Handbook of Panel Data Models. New York: Oxford Universirt Press, 76-110.
  • Cole, M.A. & Elliott, R.Jr. (2005). FDI and the capital intensity of “dirty” sectors: A missing piece of the pollution haven puzzle. Review of Development Economics, 9, 530-548.
  • Cole, M.A., Elliott, R.Jr. & Fredrikson P.G. (2006). Endogenous pollution havens: Does FDI influence environmental regulations? Scandinavian Journal of Economics, 108 (1), 157-178.
  • Destek, M.A. & Okumuş, İ. (2019). Does pollution haven hypothesis hold in newly industrialized countries? Evidence from ecological footprint. Environmental Science and Pollution Resarch, 26, 23689–23695.
  • Dietzenbacher, E. & Mukhopadhyay, K. (2007). An empirical examination of the pollution haven hypothesis for India: Towards a green leontief paradox? Environmental and Resource Economics, 36, 427-449.
  • Dünya Bankası (2020). World Development Indicators. https://databank.worldbank.org/source/world-development-indicators#
  • Ederington, J., Arik Levinson & Jenny Minier, (2004). Trade liberalization and pollution havens. NBER Working Papers 10585, National Bureau of Economic Research, Inc.
  • Grossman, G.M. & Kruger, A., (1995). Economic growth and environment. The Quarterly Journal of Economics, 110(2), 353-377.
  • Halıcıoğlu, F. & Ketenci, N. (2016). The impact of international trade on environmental quality: The case of transition countries. Energy, 109, 1130-1138.
  • Hao, Y. & Liu, Y-M. (2015). Has the development of FDI and foreign trade contributed to China’s CO2 emissions? An empirical study with provincial panel data. Natural Hazards, 76, 1079-1091.
  • Karluk, R. (2009). Uluslararası Ekonomi. Ankara: Beta Yayınevi.
  • Kearsley, A. & Riddel, M. (2010). A further inquiry into the pollution haven hypothesis and the environmental kuznets curve. Ecological Economics, 69, 905–919.
  • Kızılkaya, O. (2017). The impact of economic growth and foreign direct investment on CO2 emissions: The case of Turkey. Turkish Economic Review, 4 (1), 1006-118.
  • Lee, C.G. (2009). Foreign direct ınvestment, pollution and economic growth: Evidence from Malaysia. Applied Economics, 41, 1709-1716.
  • Merican, Y., Yusop, Z., Mohd, Z. & Hook, L.W. (2007). Foreign direct investment and the pollution in five ASEAN nations. International Journal of Economics and Management 1(2), 245-261.
  • Omri, A., Nguyen, D.K., & Rault, C. (2014). Causal interactions between CO2 emissions, FDı, and economic growth: Evidence from dynamic simultaneous-equation models. Economic Modelling, 42, 382-389.
  • Pao, H-T. & Tsai, C-M. (2011). Multivariate granger causality between CO2 emissions, energy consumption, FDI and GDP: Evidence from a panel of BRIC countries. Energy, 36(1), 685-693.
  • Poelhekke, S. & Ploeg, F. (2015). Green havens and pollution havens. The World Economy, 38(7), 1159-1178.
  • Rahman, Z.U., Chongbo, W. & Ahmad, M. (2019). An (a)symmetric analysis of the pollution haven hypothesis in the context of Pakistan: A non-linear approach. Carbon Management, 10(3), 227-239.
  • Rahul, R. & Viswanathan, P. K. (2018). Impact of environmental policy stringency on FDI: A global perspective. International Journal of Pure and Applied Mathematics, 118(5), 623-629.
  • Ritchie, H. & Roser, M., (2018). CO₂ and greenhouse gas emissions. Published online at OurWorldInData.org. Retrieved from: 'https://ourworldindata.org/co2-and-other-greenhouse-gas-emissions'.
  • Sadik-Zada, E.R. & Ferrari, M. (2020). Environmental policy stringency, technical progress and pollution haven hypothesis. Sustainability, 12 (9), 3880.
  • Shao, Q., Wang, X., Zhou, Q. & Balogh, L. (2019). Pollution haven hypothesis revisited: A comparison of BRICS and MINT countries based on VECM approach. Journal of Cleaner Production, 227, 724-738.
  • Singhania, M. & Saini, N. (2021). Demystifying pollution haven hypothesis: Role of FDI. Journal of Business Research, 123, 516-528.
  • Solarin, S.A., Al-Mulali, U., Musah, I. & Öztürk, İ. (2017). Investigating the pollution haven hypothesis in Ghana: An Empirical Investigation. Energy, 124, 706-719.
  • Tang, J. (2015). Testing the pollution haven effect: Does th type of FDI matter? Environmental Resource Economics, 60, 549-578.
  • Ullah, A., Zhao, X., Kamal, M.A. & Zheng, J. (2020). Environmental regulations and inward FDI in China: Fresh evidence from the asymmetric autoregressive distributed lag approach. International Journal of Finance & Economics, 1-17.
  • Wagner, U., & Timmins, C. D. (2009). Agglomeration effects in foreign direct investment and the pollution haven hypothesis. Environmental Resource Economics, 43, 231-256.
  • Yıldırım, M., Destek, M.A. & Özsoy, F.N. (2017). Doğrudan yabancı yatırımlar ve kirlilik sığınağı hipotezi. C.Ü. İktisadi ve İdari Bilimler Dergisi, 18 (2), 99-111.
  • Yılmazer, M. & Açıkgöz-Ersoy, B. (2009). Kirlilik sığınağı hipotezi doğrudan yabancı yatırımlar ve kamu politikaları. Ege Akademik Bakış, 9 (4), 1441-1462.
  • Yoon, H. & Heshmati, A. (2017). Do environmental regulations effect FDI decisions? The pollution haven hypothesis revisited. IZA Discussion Papers No. 10897.
  • Zhang, J. & Fu, X. (2008). FDI and environmental regulations in China. Journal of the Asia Pacific Economy, 13(3), 332-353.
There are 45 citations in total.

Details

Primary Language Turkish
Subjects Economics
Journal Section Makaleler
Authors

Ferhat Pehlivanoğlu 0000-0001-6930-0181

Ali Rıza Solmaz 0000-0001-8347-1593

Publication Date December 20, 2021
Submission Date April 17, 2021
Published in Issue Year 2021 Volume: 5 Issue: 2

Cite

APA Pehlivanoğlu, F., & Solmaz, A. R. (2021). Kirlilik Sığınağı Hipotezi: BRIC ve MIST Ülkeleri için Dinamik Panel Veri Analizi. Bingöl Üniversitesi İktisadi Ve İdari Bilimler Fakültesi Dergisi, 5(2), 471-493. https://doi.org/10.33399/biibfad.918535


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